U.S. mortgage applications rise as borrowing rates hit record low

Wednesday 8th February 2012

U.S. mortgage applications increased by 7.5% for the week ending 3 February, suggesting that more homeowners and homebuyers are taking advantage of historically low mortgage borrowing rates, according to weekly data released today by the Mortgage Bankers Association.

Rates for 30-year fixed-rate mortgages with both conforming loan balances and jumbo loan balances fell to the lowest rate in the history of the survey, suggesting that now is a good time to take out a mortgage in order to buy a home in USA.

For conforming loan balances average rates fell to 4.05%, from 4.09%, and for jumbo loan balances to 4.29%, from 4.33%.

Refinances increased 9.4% week-on-week, while mortgage applications for new USA property purchases increased by 0.1%. Refinances comprised exactly 80% of all applications, down from 81.3% the previous week.

In January, the share of applications for home purchase by investors was 6.4%, down from 6.9% in December. The adjustable-rate share of mortgage activity increased to 6% from 5.6% of total applications compared to the previous week.

FHA-backed 30-year loan rates dropped to 3.89%, from 3.96% the previous week, also the lowest rate in the history of the survey, while 15-year mortgage rates decreased to 3.33% from 3.36% - also the lowest rate on the survey’s record.